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SST PRINCIPLES
A WC's Streamlined Sales Tax (SST) Connnittee recommends adoption of the following
principles:
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1. Negatively Impacted Cities (NICs) agree to drop the sourcing reversion clause in
SB 5622.
2. Positively Impacted Cities (PICs) agree to accept the mitigation proposal
contained in SB 5622.
3. PIC cities agree to accept supplemental reporting requirements proposed by NIC
cities (see attached).
4. Both sides agree the role of the Oversight Connnittee will remain unchanged from
that proposed in SB5622 and there will not be an expansion of the powers of the
Committee.
5 Both sides agree there needs to be a simple and accessible appeal process for
those jurisdictions that disagree with their mitigation allocation. Bill language
needs to be developed for this purpose.
6 Both sides agree that the bill needs to clearly reflect that additional sales tax
generated from future annexations is excluded for mitigation determination
purposes. SB 5908 of2005 has language to this effect which may be satisfactory.
7 Both sides agree to work together toward the goal of producing an SST bill this
session that will provide for full mitigation to the NIC's and all of the sourcing
gains to the PIC's. Both sides also recognize that the legislative process may
render something different than our joint proposal in the end. We are all
mmitted to achieving our joint proposal achieving full sourcing gains to the
PIC's an mitigation to the NIC's within the reality ofthe legislative process
and with the goal of successfully passing a bill during the 2006 session.
~~~
Pam Carter, Council, Tukwila
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utchinson, Mayor, Lake Forest Park
ack r:; c, Deputy Mayor, Spokane
~~
Mike Martin, Administrator, Kent
er, University Place
Supplemental Reporting
Section 904(1) of Senate bill 5622 provides for businesses to report to the Department of
Revenue "additional information" no more often than every six months. This is the
"supplemental reporting" requirement in the bill. This information is highly important to
be able to quantify the actual amount of losses to be mitigated. This additional
information will be nothing more than the total taxable sales by location, basically the
same information that they report currently. This requirement is also provided for in the
national Streamlined Sales Tax Agreement.
We agree with the desire to limit the need for this supplemental reporting and also agree
with the desire to eliminate this requirement over time. Our view on how to accomplish
this is as follows:
We believe that the 600 firms that would need to file supplemental reports as estimated in
DOR's fiscal note to bill 5622 may be correct initially. We would propose that only firms
that cause significant shifts in sourcing sales within NIC's would need to report. As the
local jurisdictions go off mitigation, the requirement for the firms to file supplemental
reports for those firms within those jurisdictions would be eliminated. We would propose
that this requirement be eliminated after two years so that we can be assured that the
jurisdiction does not slip back into a mitigation situation.
The result of this system of supplemental reporting will be a gradual reduction of the
number of firms required to file supplemental reports annually until taxation of remote
sales is authorized nationally. At that time the requirement would be reduced to
approximately 10% of the firms originally required to report.